Panasonic joins trend of reshoring out of nation
Panasonic Corp plans to transfer most of its domestic appliance production in China back to Japan starting in the spring, a response to the weaker yen and a jump in labor costs in China.
It is one of several Japanbased companies making such a move.
Panasonic President Kazuhiro Tsuga said in an interviewonTuesday, according to KyodoNews, that the company will move its washing machine and other home appliance production back to Japan and export products that are made in Japan to other markets.
Panasonic plans to export about 40 types of home appliances made domestically to Asian markets.
Tsuga did not reveal the location of the reshored factories. But microwave ovens and top-loading washing machines, which are almost allmadeinChinanow, will be the first products for which production is resumed in Japan at factories in Shizuoka prefecture and Kobe, respectively.
Panasonic said that a 1 yen drop against the dollar reduces profit by about 1.8 billion yen ($15.1 million) on an annual basis. If the yen stabilizes at 120 to the dollar, this will cause a significant decrease in profit even if the company cuts back on costs, according to the Yomiuri Shimbun.
Panasonic China’s public relations office said it had not heard of such plans or decisions, and it declined to comment further.
It would be the
first such large-scale reshoring of the company’s foreign production. After 35 years operating in China, Panasonic has three plants in Hangzhou, Guangzhou and Shanghai.
Rising labor costs in China are also driving the relocation of Japanese factories, said Su Liang, branding director of the China Home Appliance Research Institute.
He said the shortage of senior skilled workers at home appliance plants has pushed up their salaries and thus increased employers’ costs.
Sharp Corp also plans to reshore overseas TV production, and Daikin Industries Ltd has moved part of its air conditioner production from China to Japan.